About Me

Author of "Common Genius" -- a brief history of how common people built the prosperity of free nations, and how the intelligentsias usurp control and bring on decline -- go to: www.thecommongenius.com
Just published the sequel--"Wasted Genius," How IQ and SAT tests are Hurting Our Children and Crippling America. An analysis of how our schools and colleges are adding the the intellectual morons who make up the New Ruling Class. See www.thewastedgenius.com

Wednesday, January 2, 2013

How the
Republicans won the "Fiscal Cliff" Battle

The compromised settlement
enacted over the New Year Holiday has been hailed as a win for Obama who, as
the main stream media spins the story, ran circles around a confused and
incompetent Republican leadership. Nothing could be further from the truth. The
hypocrisy of this Administration, that claims above all to be protecting the
Middle Class, was revealed when it went into the negotiations with no intent on
extending the payroll tax breaks. Right off the bat, they were intent on hitting
the middle class and working poor with a substantial tax increase that will
show up in reduced paychecks this week. So much for protecting those in the
middle!

Further, the very idea of
extending the Bush tax cuts went against everything they stood for--for years they have criticized Dubya for that tax
cut--and now they have extended them for a second time and made them permanent!The increase of 3% on incomes over $450K is a
paltry difference--most people in that category won't feel it, and will
continue to get most of their income from capital gains, dividends, tax exempt
interest, and sheltered sources immune to that 3% increase. Basically, the
Democrats fought for the Republican/Bush
tax cuts. Plus they renewed the $5
million estate tax exemption, and even added a reduced tax rate on dividends
and capital gains for those fat cats with income over $ 450K!

I suspect the Republicans accomplished this
huge win by using the good cop-bad cop gambit: The leadership "used"
the tea party members as the bad cops, arguing they could not pass any legislation
that did not slash spending and entitlements. But the Republicans then hinted
that those sticky wickets might be deferred provided the Bush tax cuts were extended.
The Democrats fell for this ploy by offering to extend everything Bush did
except for a token 3% increase on ordinary income over $450K. The Republicans then
hinted that that might pass muster with their base, provided the deferral of
the entitlement spending cuts was only extended for two months. The administration
then went ahead, got their minions to join enough Republicans to pass that
compromise, and called it a victory. After
all, they had soaked the rich and avoided spending cuts.

Lost in the media blitz
was the fact that Obama had campaigned on a $250K income threshold, a reduction
in the estate tax exemption, and had repeatedly stated that those points were "non-negotiable."But he caved on both! When will the media
recall the "Read my Lips" line, which would lampoon Obama's stance
throughout the "crisis."

The brilliant aspect of
all this was that the Republicans had cornered the Democrats from the beginning
into seeking a virtually total extension of the Bush tax cuts and a temporary
escape from the sequestration nightmare that will cut entitlement spending. George
W. Bush must be very pleased today to see his oft-criticized tax reductions
made permanent, and the Democrats crowing about it! And, hopefully, Speaker
Boehner and his colleagues in the House are lying in wait for another win on
March 3, when they might be able to head toward a balanced budget by cutting
spending and slowing the spiraling national debt.